Abacus is a VC-backed Facebook marketing agency built to arm startups with data

A new digital marketing agency has sprung up in Toronto, led by some familiar names. Called Abacus, the company was founded by Peter Reitano, former President of digital agency Spark, and Jeff Goldenberg, most recently Head of Growth at local FinTech startup Borrowell.

Borrowell isn’t the only startup connection for Abacus, as the company is launching with institutional funding from VC firm Vitality Capital (Abacus has not disclosed the full amount, but it is in the sub-$1 million seed range). The agency also has an advisory board filled with notable names, including Round13 Capital founder and former Dragon Bruce Croxon (disclosure: Croxon is also currently the co-host of BNN’s The Disruptors, of which BetaKit is a production partner), Symbility Intersect VP Anthony Lipkin, and 88 Creative Managing Director Erin Bury (another disclosure: Bury is the original Managing Editor of BetaKit and our current regular on the CanCon podcast).

Abacus is promising to offer its clients a data-driven approach to Facebook advertising. BetaKit spoke with Goldenberg, who wrote the book on growth hacking, about the company’s narrow focus, target customer, and the interest from VCs and other marketers.

Why the move from client side to agency side?

I’ve been a buyer of digital services for the past 10 years. I’ve been traditionally underwhelmed with the services I’ve been pitched over the years. I’ve always felt that they did a poor job of sharing the risk, either expecting the client or the agency to bare much of the risk. I’ve also found them to be frustratingly opaque in terms of their process and their projected result.

“I think you need to go all-in on a channel to become an expert at it. I don’t believe the agencies that say they’re good at everything.”

At the same time, I’ve been watching the demand for focused, growth-minded marketers explode over the last few years, while the supply remained extremely limited. When Peter and I discovered our shared vision for the future of digital agencies, it felt like the timing was right. Some of the largest Canadian companies are going to spend more on digital than traditional beginning in 2017, and I believe the days of unaccountable marketing is coming to an end.

Ultimately, we’d like to help companies of all sizes, from all around the world, meet and exceed their growth goals. We want to accelerate their learning curve and minimize their wasted spend. We want to help them develop a performance mindset that holds their digital spends accountable. We want to show traditional marketers how to adopt a scientific approach to marketing and help them optimize further down their funnels. Basically, we want to teach the big guys how to think like and market like agile startups.

What led you to develop your interest in Facebook as a core marketing tool, and why are you going all-in now from a service perspective?

When I began my role as Head of Growth at Borrowell in the summer of 2015, we decided to manage our Facebook channel in-house and try to become experts at using Facebook for acquisition marketing. Myself and my colleague (shout out to Rob Palumbo!) spent hours every day experimenting with Facebook ads, and slowly but surely, optimizing our acquisition cost month over month. It was a very difficult learning curve, and it took us a lot of experimentation to uncover efficiency improvements.

At some point in the journey, we were invited to join an awesome client team at Facebook and have them consult on our account. That’s when our learnings started to accelerate and we began the process of understanding how the ad algorithms and exchange worked from the inside out. Working with them over the months was incredibly invaluable. And now we’d like to leverage our learnings and help other companies grow.

I think you need to go all-in on a channel to become an expert at it. I don’t believe the agencies that say they’re good at everything. It took us a long time to get proficient at Facebook, and I don’t think I could have done that if I was focused on several channels. Facebook is really powerful. They offer incredible targeting options, are always innovating and developing new ad types, and enable marketers to link their offline and online data, which enables very powerful precision targeting and content amplification opportunities.

What type of clients is Abacus looking to target?

For the most part, we are going to focus on helping large Facebook advertisers get better performance out of their Facebook ad spend, and help them approach their marketing from an iterative, scientific, growth mindset. We are going to help companies understand how much they can spend on customer acquisition and be able to grow quickly, and optimize their campaigns towards this growth goal.

For new Facebook advertisers and selected startups, we have a program called The CPA Lab. The CPA Lab is a rotating 60-day program that puts cohorts of 8 companies through a rigorous, scientific testing program to establish their cost per acquisition and understand how it can be optimized over time.

Finally, we will also provide Facebook account audit services, special consulting services, keynote speaking, corporate workshops and training, and growth events throughout Canada and the US.

We don’t see VCs investing in marketing agencies very often. What’s that about?

We’re extremely excited to have Vitality Capital and Gershon Hurwen as our financial partner. Having access to startup and scaling capital will give Abacus the opportunity to grow faster, attract and hire top talent, build out our data science capabilities, conduct research and development around technical and data advantages and generally progress several projects that will comprise the Abacus secret sauce for our clients.

You have a lot of well-known people on your advisory board, closely related to your space. What’s their interest in Abacus?

Peter and I have so many heroes in the advertising and marketing industry that we wanted to figure out a way to involve them in our little project. We love the idea of surrounding ourselves with really smart, really connected advisors, who can help us grow both professionally and personally.

I think their interest in Abacus is that they share our vision of the future of agencies and the future of digital marketing in general. They share our belief that specialization is the future of agency, and that code and data are the new art and copy. They also understand that the industry is evolving so quickly, that the degree of expertise needed to market efficiently is increasing, while the available talent decreases. In short, I think they all want to be part of the solution and part of the future of digital marketing.